Now Reading
GCC Petrochemical Exports To Surge In 2014 – GPCA

GCC Petrochemical Exports To Surge In 2014 – GPCA

GCC petrochemical exports are expected to rise due to the Bali Package, which aims to cut the cost of trade by 15 per cent.

The GCC petrochemical industry is expected to record an increase in exports in 2014 due to the World Trade Organisation’s (WTO) Bali Package, according to the Gulf Petrochemicals & Association (GPCA).

The trade facilitation agreement, which is a part of the WTO’s Bali Package, creates a binding commitment among member countries to increase customs efficiency and revenue collection by reducing bureaucratic procedures.

“The WTO’s deal on trade facilitation, if implemented in its true spirit, will reduce the cost of all GCC petrochemicals exports, thus easing the flow of goods across borders and cutting delays in international shipments, especially in the countries where Gulf chemical exporters have encountered difficulties in the past,” said Abdulwahab Al-Sadoun, GPCA’s secretary general.

The WTO estimates that the world economy is set to benefit from the agreement as it aims to cut costs of trade by 10 to 15 per cent, contributing to increased trade flows and higher revenues while creating a stable business.

The agreement, formed in December last year, is expected to boost the Gulf’s petrochemical industry, which is an export-oriented sector, the GPCA said.

The GCC’s petrochemicals industry exported 60.7 million tonnes of chemicals in 2012, equivalent to 75 per cent of its output, which is valued at $52.7 billion.

“The trade facilitation agreement will provide GCC petrochemical exporters with an opportunity to reduce costs and time delays through simple and uniform customs procedures,” said Sadoun.

“The agreement removes major obstacles for petrochemical exporters from the Gulf, and will be directly responsible for the increased chemical trade, leading to the growth of the industry.”

Export barriers against GCC petrochemicals will only be eased in the second half of the year, as the Bali Package is set to be ratified by the WTO General Council by July 2014.

But the petrochemicals industry is optimistic about its impact on future trade.

The Middle East has a well-developed petrochemical industry owing to their access to cheaper feedstock. However, the industry has been facing new challenges with rising costs and greater competition.

At the GPCA forum last year, Saudi Arabia’s deputy oil minister Prince Abdulaziz Bin Salman Bin Abdulaziz warned the GCC to be cautious about the rising surge of protectionism across the world in the petrochemicals industry.

He added that such protectionist policies would increase market players vying for a share in the industry.

© 2020 MOTIVATE MEDIA GROUP. ALL RIGHTS RESERVED.

Scroll To Top